CFI announced in March this year that Stalap owned a 41 percent stake in the company after purchasing 13,6 million shares, representing 12,9 percent of its total issued share capital.

According to ZSE listing rules, a company which has acquired a shareholding exceeding 35 percent should make a mandatory offer to minority shareholders of the acquired listed company but the ZSE had previously noted that Messina Investments, owned by British tycoon, Nicholas van Hoogstraten’s shareholding had passed the 35 percent threshold and would also be required to make an offer.

Stalap was established solely as an investment holding company for CFI shares owned by Zimre Holdings and its affiliates. Zimre Holdings and its wholly owned subsidiary, Baobab Reinsurance have a shareholding of 34,28 percent apiece in Stalap, while the National Social Security Authority (NSSA) holds the remaining 31,24 percent.

Stalap does not intent to delist CFI post the mandatory offer.

“Stalap intents to maintain the ZSE listing of the Company subject to meeting all ZSE Listing Requirements . Post the mandatory offer, if CFI Holdings Limited is in breach of any ZSE Listing Requirements the Company will engage the ZSE Listing Committee for guidance and compliance,” CFI said in a circular to shareholders on Thursday.

Additionally, Stalap will use its own funds to pay all CFI minority shareholders who accept the offer.

“A letter of commitment has been provided by Stalap’s principal bankers confirming the holding of deposit funds of $14 million which is sufficient to meet the total possible value of mandatory offer,” read the circular.

CFI shares closed at 18 cents on Wednesday, implying the offer is made at a 22,2 percent premium based on the current price.

At an offer price of 22 cents, Stalap requires approximately $13,8 million to buy all CFI minority shareholders. The offer values CFI at $23,4 million.

The mandatory offer opens on July 17 and closes on August 4.

The agro-industrial group intends to undertake a recapitalisation of the group in the short to medium term to revive its businesses, Crest Poultry group and Victoria Foods, that were put under judicial management in 2016.

CFI in May said it was planning to raise capital by way of a rights issue.

In the half year to March 31, CFI Holdings reported that it had narrowed its after-tax loss to $272,784 from a $6,1 million loss incurred in the prior half year-end, supported by the improved performance of its Farm and City unit. Revenue increased by 30 percent to $24,9 million from $19,1 million recorded in the previous year.

Other major shareholders of CFI group as at June 27,2017 were Messina investment , EFE Securities Nominees and Willoughby’s consolidated limited with 18,7 percent, 11,6 percent and 3,9 percent respectively.